Category: Federal Reserve

The Risks of Quantitative Tightening
Federal Reserve

The Risks of Quantitative Tightening

This past December, after a 7% year-over-year inflation increase, Federal Reserve Chairman Jerome Powell reversed course. He declared that inflation was not transitory and laid out his plan for how the Fed would start fighting it.

Money Creation in the Time of Quantitative Easing (Q.E.)
Federal Reserve

Money Creation in the Time of Quantitative Easing or Q.E.

In capitalism, the government’s role in creating new money is limited. It mostly moves around money that is already in the economy, funds itself by collecting taxes or selling government bonds, and then spends that money back into the economy.
 

Negative Interest Rates
Federal Reserve

I’m Positive Negative Interest Rates Won’t Work

The European Central Bank, Sweden, Denmark, Switzerland, and Japan have all implemented some form of ‘negative interest.’ However, none of these countries or regions have seen commercial banks charging their customers for depositing money.[i]

Is Quantitative Easing (Q.E.) Stimulative
Federal Reserve

Is QE 4 Stimulative?

There is no way to know for sure. Still, when the Fed adds money to the economy by buying bonds from non-banks, the stock market seems to go up. When they subtracted cash from the economy by not reinvesting mortgage payments (quantitative tightening), it went down.

Is the Federal Reserve Making It Up
Federal Reserve

Is the Federal Reserve Making It Up As They Go Along?

In February of 2019, two months after telling the world that the Fed balance sheet reduction plan was on autopilot, Chairman Powell announced that the Fed would soon unveil a plan to end it

Tim Hayes

Tim Hayes

I am an Investment Adviser Representative at Cambridge Investment Research Advisors, Inc., a Registered Investment Adviser (RIA) based in Fairfield, IA. I am also registered with Cambridge Investment Research, Inc., a broker-dealer with over 3,000 registered representatives nationwide.
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